CANADA STOCKS-TSX edges down on weaker golds, eye on Fed

Wed Jun 20, 2012 11:16am EDT
 
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* TSX down 35.15 points, or 0.3 percent, at 11,753.21
    * Weakens from Tuesday's five-week high
    * Softer bullion prices hit Barrick, Goldcorp
    * Markets cautious ahead of U.S. Fed meeting

    By Allison Martell
    TORONTO, June 20 (Reuters) - Canada's main stock index edged
lower Wednesday, hurt by a drop in gold mining stocks as bullion
weakened, with investors focused on the U.S. Federal Reserve's
policy announcement later in the day.
    The heavyweight materials group, which includes gold miners,
fell 1.7 percent as the price of gold eased on caution ahead of
the Fed statement. 
    Canadian stocks had hit a five-week high on Tuesday, as
financial and energy shares rallied on hopes the Fed would
announce further monetary stimulus.
    "We had a very good day yesterday, especially in Toronto,
and I think today maybe it's just more of the malaise that we've
had for quite awhile here," said John Kinsey, portfolio manager
at Caldwell Securities Ltd.
    At 10:30 a.m. (1430 GMT), the Toronto Stock Exchange's
S&P/TSX composite index was down 35.15 points, or 0.3
percent, at 11,753.21.
    Barrick Gold, the world's top gold producer, was
down 1.2 percent at C$40.52, while Goldcorp Inc fell 2.4
percent to C$39.23. The miners played the biggest role of any
two stocks in leading the Toronto market lower.
    Kinsey said the market was likely to trade little changed to
slightly lower until investors hear from the Fed.
    The Fed's Open Market committee's policy statement is due at
12:30 p.m. (1630 GMT), followed by the Summary of Economic
Projections at 2 p.m. and Chairman Ben Bernanke's press
conference at 2:15 p.m.
    Analysts expect the Fed to extend long-term bond-buying
through "Operation Twist" by a few months from the current
deadline in June.
    But many investors doubt it will go as far as launching
another round of quantitative easing, a policy that entails the
expansion of its balance sheet via bond purchases.
    "The market is looking for some direction, whether it's some
kind of a twist on the Twist, or is it going to be a QE3, or are
they just going to let the status quo go forward?" said Kinsey.
    Helping support the Canadian market was convenience store
operator Alimentation Couche-Tard Inc. Its stock rose
4.7 percent to C$45.03, the biggest percentage gain of any
company in the index.
    The retailer said it had reached the 90 percent shareholder
acceptance level in its bid for Norway's Statoil Fuel and Retail
ASA, which will allow it to more easily incorporate
the European acquisition..